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Posts Tagged ‘Exadata’

Oracle-HP: How things got this bad

Posted in Board Of Intellectual Capital, Intellectual capital, internet, Investments, Java, Market research, Strategy, Sun Microsystems, Technology, tagged , , , , , , , on February 3, 2012| Leave a Comment »

Article from GigaOm.

For many years, Oracle and HP co-existed quite happily. They collaborated on the first Exadata in 2008, for example. Former HP CEOs Carly Fiorina, then Mark Hurd, keynoted at Oracle OpenWorld. HP appeared to have supplanted Sun Microsystems as Oracle’s hardware BFF for a while. Everything was copacetic.

Now the two companies are arch-rivals and are engaged in an increasingly bitter, seemingly personal battle, the latest skirmish of which saw a California Superior Court judge throw out a fraud claim Oracle lodged against HP. He also opened up court documents that don’t show either company in a particularly good light.

How did it all go so bad?

First, Oracle bought Sun for $7.4 billion in a deal completed in January 2010. That meant Oracle, for the first time was in the hardware business and its servers would compete with HP servers. That sealed the fate of the relationship going forward.

The public bad feeling erupted in August 2010 when HP canned Hurd as CEO, then hired former Oracle president Ray Lane (pictured above right) as chairman and Leo Apotheker, former CEO of SAP, as CEO. SAP is a huge rival to Oracle in enterprise apps and Lane left Oracle after a bumping heads with Oracle chairman Larry Ellison (pictured at right.) Things have just deteriorated ever since.

Here are some highlights (low lights) of the slap fight.

In a letter to the New York Times in August 2010, Ellison said HP’s firing of Hurd:

The H.P. board just made the worst personnel decision since the idiots on the Apple board fired Steve Jobs many years ago … That decision nearly destroyed Apple and would have if Steve hadn’t come back and saved them.”

HP’s server and storage chief Dave Donatelli blasted Oracle for discontinuing Itanium development at the HP partner conference in March 2010. Donatelli asked the couple thousand HP resellers in attendance to lobby Oracle to reverse it’s Itanium decision.
This is a shameless attempt to force customers to spend a lot of money to move to a platform over time that gives customers no benefits  … Oracle made this decision to slow Sun SPARC market losses.

Ray Lane calls out Hurd in his letter to The New York Times in October, 2010.

The bottom line is: Mr. Hurd violated the trust of the Board by repeatedly lying to them in the course of an investigation into his conduct. He violated numerous elements of HP’s Standards of Business Conduct and he demonstrated a serious lack of integrity and judgment
ut now in California District Court is just the latest in a  deterioration of a previously beneficial relationship between the two tech giants.

After Apotheker announced HP plans to buy Autonomy — another enterprise software company for $11.7 billion in August, Oracle couldn’t contain itself.

In a statement on September 28, 2011, Oracle said Autonomy had shopped itself to Oracle first and Oracle turned it down. When Autonomy CEO Mike Lynch denied that, Oracle said: “Either Mr. Lynch has a very poor memory or he’s lying.”

When there was further denial, Oracle put out another statement entitled “Another whopper from Autonomy CEO Mike Lynch” and helpfully published the PowerPoint slides it said he and banker Frank Quattrone brought to the meeting.  The presentation is here and here.

According to the statement:

Ably assisting Mike Lynch’s attempt to sell Autonomy to Oracle was Silicon Valley’s most famous shopper/seller of companies, the legendary investment banker Frank Quattrone.  After the sales pitch was over, Oracle refused to make an offer because Autonomy’s current market value of $6 billion was way too high.

The next chapter in this saga may be a trial on HP’s remaining claims against Oracle which should kick off in April, but stay tuned: anything can happen and usually does.”

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Is EMC the Next Step in Oracle’s Journey to $100B?

Posted in Board Of Intellectual Capital, tagged , , , , , , , , , , , , , , , on October 18, 2010| Leave a Comment »

Article from GigaOm.

“Oracle bought Sun Microsystems, hired former HP CEO Mark Hurd and declared that as “Oracle continues to grow, we need people experienced in operating a $100 billion business,” and ever since, the technology world has waited to see what other acquisitions Larry Ellison might have up his sleeve. This past week, we saw strong reactions to the rumor that Oracle might make a bid to buy EMC, due to the acquisition’s outlandish nature and monetary mismatch. Oracle will need to more than triple its revenue to reach that $100 billion target, so anything is possible.

That said, the rumor whips up a bunch of financial questions, because EMC owns 80 percent of VMware. EMC has a market capitalization of around $43 billion, and VMware around $32 billion. Match that up with EMC’s annual revenues of around $15 billion and VMware at $2.4 billion, and it isn’t hard to figure out where most of the value is, as well as where Oracle might be able to get a good deal on the multiple leading storage platforms.

So yes, the idea of Oracle buying EMC and VMware is a little crazy. But the idea of buying EMC and not VMware is within the realm of possibility, at least on paper, with The Register estimating that the non-VMware portion of EMC could be worth as little as $7.9 billion.

This is where things get interesting. The industry appears to be pushing towards server, network and storage consolidation following the moves of HP, IBM, Cisco, and Dell. Even Oracle has pushed a complete hardware and software package with Exalogic and Exadata using technology from Sun Microsystems to deliver an integrated solution. EMC and Network Appliance remain the large pure-play storage companies that could add significant heft to a server vendor that wants to dominate integrated stacks. HP and IBM have too much product overlap, and Dell can’t afford EMC, so that leaves an opening for Oracle and Cisco.

It seems likely that Oracle could be considering an EMC-only bid. I’ve heard some speculate that the reason Oracle became so tied to NetApp for certain solutions was the fear of EMC data center account control. Make no mistake; EMC knows how to close big deals, as their revenue number proves. If the goal for Oracle is to reach $100 billion, NetApp wouldn’t help them as effectively. NetApp currently has an $18 billion dollar market cap and just over $4 billion in revenue.

With Oracle, and potentially Cisco, interested in looking at a the EMC part of the equation, there could be impetus to move this deal forward. Even though Sun had plenty of great storage technology, they never had the commercial product success and storage revenues of EMC. If consolidation between servers and storage is the future, EMC better get cozy with someone soon.”

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